05 November 2018: There will be a misconception in which a trust will be only for wealthy individuals as well as one needs a lot of money to set in which up. The reality will be in which any person can open a trust if they have some form of an asset in which they feel need to be safeguarded for the benefit of their beneficiaries.
Matlhodi Leteane, Head of Operations at FNB Fiduciary says “when one considers setting up a trust, they first need to answer two key questions; why as well as for who. Why represents the reason you are setting up a trust while who represents for whose benefits?
Trusts are used as an effective estate planning tool to safeguard the assets on behalf of your beneficiaries. For example, debts in which belong to the person who opened a trust are separated via the assets in which are in a trust because a trust will be a stand-alone vehicle.
“Consumers must not lose track of the reasons they opened a trust although look at the long-term benefits in which a trust will afford their beneficiaries,” says Leteane.
Leteane outlines what a trust can allow individuals in order to safeguard their assets for the benefit of their beneficiaries:
- The smooth transfer of wealth via one generation to the next (or even multiple generations)
- A flexible estate planning tool allowing for the limitation of assets held in one’s personal capacity
- The separation of the ownership as well as use of assets
- A useful tool to manage as well as protect the interests of minors as well as beneficiaries who are incapable of dealing with their own financial matters
Creating a trust to look after the interest of your minor children could be as easy as drafting your will as well as including a provision for a Testamentary Trust. However, one need to ensure in which your trust structure suits your unique personal needs.
“in which will be advisable to enlist the service of professionals who are informed about the legislation in relation to trusts to ensure they can guide you. in which will ensure in which the trust will be managed according to legislation as well as best practices,” concludes Leteane.
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